Publicly traded trailer and truck body manufacturer Wabash's fourth quarter of 2023 capped a year that delivered annual records for sales, operating income, and earnings per share, the company reported recently.
“During 2023 we’ve substantially exceeded the financial performance in any year of the company’s history," Wabash President and CEO Brent Yeagy said. "Beyond our financial accomplishments, I’m even more excited about the strategic progress we made during 2023 and how it positions us to generate stronger results going forward for our employees, our customers, and our other stakeholders. Our execution is allowing us to achieve higher levels of financial performance through all phases of the cycle, and we are confident that when market conditions strengthen for our customers, we will deliver financial performance that exceeds 2023.”
For the quarter, net sales were $596 million. Operating income was $61.1 million, or 10.3% of sales. For the full year 2023, revenue totaled $2.5 billion with operating income of $311.9 million, or 12.3% of sales. While annual sales just topped 2022’s record, operating income for the year was up 87%.
Total backlog as of Dec. 31, 2023, was approximately $1.9 billion, which was “steady” compared to the prior quarter. Backlog expected to be shipped within the following 12-months was $1.6 billion—a $100 million increase from the prior quarter, the company reported.
How Wabash did it
Yeagy emphasized the company’s focus on “connections, relationships, and networks” in discussing the Q4 results with investment analysts, pointing to enhanced dry van capacity, greater focus on parts and services, as well as “innovative offerings” such as trailers-as-a-service.
“By gaining a more profound understanding of our customer problems and their opportunities, we are more able to share valuable insights with our suppliers, our technology partners, and other parties that can contribute to customer success,” Yeagy said.
Additionally, he noted that Wabash is positioned to post higher levels of financial performance through “all phases of the cycle.”
“We are confident that when the market conditions strengthen for our customers, we will achieve financial performance that exceeds 2023,” Yeagy said.
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Outlook for company, customers
While the financial performance forecast for Wabash this year is “a moderation” from 2023’s record performance, Yeagy noted that the midpoint of Wabash’s 2024 earnings guidance is “in line” the results from 2022, the second best annual financial performance in the company’s history. And such a result would “easily” be the best when facing “the headwinds of a difficult market.”
Still, the freight market is beginning “to heal and correct itself,” with measurable improvement for fleet customers “probably by midsummer”—assuming interest rates continue to moderate and that the status quo can be maintained from a “geopolitical” standpoint.
“The things that the U.S. economy is acting on sets us up for a much better 2025,” Yeagy said. “Can we see a significant demand difference in 2025? I believe that to be the case. I think you’ll see that robustness build throughout 2025, and I think it can be material. We are planning our business based off of that being the most probable outcome.”
